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What does it mean that my debts have been discharged? (Updated 2020)

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In a Nutshell

A discharge order that tells your creditors they are forever prohibited from asking you to pay your pre-bankruptcy debts ever again.

Written by Attorney Andrea Wimmer.  
Updated September 23, 2020


Having your debts discharged means that the court entered a discharge order in your case. The discharge (or discharge order) is your main goal in filing for bankruptcy protection. It is an order from the court - entered pursuant to the provisions of the Bankruptcy Code - that tells your creditors they are forever prohibited from asking you to pay your pre-bankruptcy debts ever again. Whether you file under Chapter 7 and your discharge is entered approximately four months after your case is filed, or you filed under Chapter 13 and your discharge is entered after you complete your payment plan, getting your discharge is what protects you even after your bankruptcy case is closed. In other words, a discharged debt is a debt that the creditor can’t try to collect from you.

The court will automatically send a copy of the discharge order to all of the creditors on your mailing list. At the same time that happens, the court will send you a copy as well. Since this is what you’ve been working towards, it’s important to keep this document in a safe place where you can find it again in case you need it. You do not have to send the discharge to your creditors. By now, your creditors should have stopped contacting you long ago and the only reason you would ever need to send them a copy of your discharge is if they didn’t get the copy from the court, for whatever reason.

You will not receive a separate notice from each of your creditors that your debt has been discharged. We do recommend, however, that you get a copy of your credit report about a month after your discharge is entered, so you can make sure everyone is correctly reporting your discharge. If a pre-bankruptcy debt does not show up as discharged on your report, you should file a dispute with the credit reporting agency to correct this. At this point, it is not practical (nor effective) to contact your creditor about this as they will (or should) have a big flag in their system that they are legally prohibited from trying to collect from you. Therefore, even if you call them, they might not speak to you about your account at all, even if all you are trying to do is verify that the debt has been discharged.

The discharge does not list out each one of your creditors individually - it applies to them all across the board and is limited only by the non-dischargeability provisions in the Bankruptcy Code. This means that even creditors who cannot be discharged (such as student loans or some tax debts) will receive a copy of the discharge. For those creditors, the discharge tells them that the automatic stay has been terminated and they can resume collection activities from you.

If you have tax debts that are more than three years old, they may have been discharged. Since a lot of factors go into determining whether your tax debt was discharged, your best bet is to wait 30-60 days, then contact your local IRS office. By then, their system should have updated throughout and they should be able to tell you which of your tax debts, if any, have been discharged. If you had a tax lien filed against you for any of the discharged tax years, you should also ask them about releasing the lien at that time.

Conclusion

Getting your debts discharged is the point of your bankruptcy case (there may be others, but it’s definitely the main one). Getting the discharge is an automatic process assuming you complete all the necessary steps of the process and the court will notify your creditors as soon as it has been entered. It does not mean that your case has been closed and you continue to be obligated to assist the trustee in the administration of your case. If you don’t, the trustee can ask the court to revoke your discharge which would then allow all of your creditors to start coming after you again (making the entire bankruptcy case basically pointless). You should continue to monitor correspondence from your trustee and the court, and keep both updated if your mailing address changes to avoid any unnecessary hiccups.



Written By:

Attorney Andrea Wimmer

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Andrea practiced exclusively as a bankruptcy attorney in consumer Chapter 7 and Chapter 13 cases for more than 10 years before joining Upsolve, first as a contributing writer and editor and ultimately joining the team full time in August 2019. While in private practice, Andrea ha... read more about Attorney Andrea Wimmer

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